Stakeholders
Every business has stakeholders involved. A stakeholder is anyone who has a claim in some way to a company’s products, operations, markets, industry, and outcomes (Ferrell, Fraedrich, Ferrell 31). Some stakeholders are more involved than others. Members that are needed for the company to maintain are referred to as primary stakeholders, whereas others are called secondary stakeholders. Primary stakeholders can be identified as employees, customers, investors, and shareholders and can also be governments and communities that provide necessary infrastructure (Ferrell, Fraedrich, Ferrell 33). The survival of a company depends on the continuous relationship with the primary stakeholders (Ferrell, Fraedrich, Ferrell 33). Ethical corporate cultures are necessary to avoid ethical conflicts and damaging relationships with primary stakeholders (Ferrell, Fraedrich, Ferrell 33). Anyone that can benefit from or be affected by a company’s actions is considered to be primary stakeholders for that company (primary stakeholder). In contrast, secondary stakeholders can be identified as anyone that is not directly affected by a company’s actions, such as media, trade associations, special interest groups, or people that live close to a company that are concerned about how a company affects the environment around them (Ferrell, Fraedrich, Ferrell 33). There are some that can function as a primary and a secondary stakeholder, such as if someone that lives close to the company are also an employee (Cynthia Gomez). Secondary stakeholders, even though they have no financial ties to the company, can affect the company just as much, if not more, than a primary stakeholder. Secondary stakeholders in the same vicinity of a company can prevent that business from expanding if they are against changes the company wants to make (Cynthia Gomez). Since primary stakeholders are involved in basically every aspect of business decisions, they must be taken into consideration with every company
Cited: Aquinas, P. G. Organization Structure and Design: Applications and Challenges. New Delhi: Excel, 2008. Print. Ferrell, Odies C., Linda Ferrell, and John Fraedrich. Business Ethics: Ethical Decision Making and Cases. 9th ed. Australia: Houghton Mifflin, 2013. Print. Gomez, Cynthia. "Why Are Secondary Stakeholders Important to a Company?" Small Business. Hearst Newspapers, LLC, n.d. Web. 12 Feb. 2014. .